Last close As at 05/08/2026
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Research: TMT
4imprint’s year-end trading update indicates that 2023 was a strong year for the group’s financial performance. Revenue of $1.33bn is in line with guidance reiterated in November of ‘slightly above $1.3bn’, but PBT is now guided at ‘not below $140m’, above our previous expectation of $131m. We attribute the stronger profitability to a combination of higher gross margin and marketing efficiency. Strong cash performance resulted in the year-end balance of $105m exceeding our prior $84m estimate. Our revised FY24 and provisional FY25 profit and cash estimates are pushed ahead on this higher base on a 10% operating margin. The shares continue to trade at a substantial discount to our DCF valuation.
4imprint Group |
FY23 finishes strongly |
Trading update |
Media |
19 January 2024 |
Share price performance
Business description
Next events
Analysts
4imprint Group is a research client of Edison Investment Research Limited |
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4imprint’s year-end trading update indicates that 2023 was a strong year for the group’s financial performance. Revenue of $1.33bn is in line with guidance reiterated in November of ‘slightly above $1.3bn’, but PBT is now guided at ‘not below $140m’, above our previous expectation of $131m. We attribute the stronger profitability to a combination of higher gross margin and marketing efficiency. Strong cash performance resulted in the year-end balance of $105m exceeding our prior $84m estimate. Our revised FY24 and provisional FY25 profit and cash estimates are pushed ahead on this higher base on a 10% operating margin. The shares continue to trade at a substantial discount to our DCF valuation.
Year end |
Revenue |
PBT* |
EPS* |
DPS** |
P/E |
Yield |
12/21 |
787 |
30.2 |
80.3 |
45.0 |
73.6 |
0.8 |
12/22 |
1,140 |
103.7 |
285.0 |
160.0 |
20.8 |
2.7 |
12/23e |
1,330 |
140.0 |
372.6 |
185.0 |
15.9 |
3.1 |
12/24e |
1,430 |
146.5 |
394.4 |
210.0 |
15.0 |
3.5 |
12/25e |
1,500 |
153.8 |
407.8 |
225.0 |
14.5 |
3.8 |
Note: *PBT and EPS (fully diluted) are normalised, excluding amortisation of acquired intangibles and exceptional items. **Excluding special dividends.
Continued market outperformance
Revenue of $1.33bn, as indicated in the update, represents year-on-year growth of 16%. This is considerably ahead of the North American market, which is estimated by industry body PPAI to have grown by 3.1% in 2023, with slower growth in H2 as economic uncertainties came more to the fore. 4imprint’s margin improvement is better than we had modelled. At the interims, FY23 guidance was for PBT of at least $125m. That moved up to at least $130m at Q323 (see our November Outlook note), so this further uplift implies a particularly good Q423 from a margin perspective. We expect the margin improvements to be maintained, so on unchanged revenue numbers, this lifts our EPS forecasts by 3% in FY24 and FY25.
Strong cash generation
The year-end cash position of $105m is well ahead of our previously modelled $84m, which was clearly conservative given that the end-October cash balance was $95m. The year-end result does imply particularly strong cash conversion in H223, with a working capital performance that reversed the inflow from the prior year. With few M&A possibilities in our view, cash utilisation priorities remain investment in growing the business and dividend payments to shareholders.
Valuation: Still well below DCF valuation
The share price has recovered c 10% from the lows post the Q323 trading update and is now c 8% up on a 12-month basis. A discounted cash flow (weighted average cost of capital of 9%; terminal growth of 3%, as before) generates an implied value of £61.15, up from £60.68 at the time of our end-November Outlook note, and well ahead of the current price.
Exhibit 1: Financial summary
$000s |
2021 |
2022 |
2023e |
2024e |
2025e |
||
Year end 31 December |
IFRS |
IFRS |
IFRS |
IFRS |
IFRS |
||
PROFIT & LOSS |
|||||||
Revenue |
|
|
787,322 |
1,140,286 |
1,330,000 |
1,430,000 |
1,500,000 |
Cost of Sales |
(561,306) |
(818,670) |
(925,553) |
(996,710) |
(1,047,000) |
||
Gross Profit |
226,016 |
321,616 |
404,447 |
433,290 |
453,000 |
||
EBITDA |
|
|
35,660 |
108,428 |
142,800 |
151,600 |
159,500 |
Operating profit (before amort. and excepts.) |
|
30,646 |
102,902 |
136,500 |
143,000 |
150,000 |
|
Intangible Amortisation |
0 |
0 |
0 |
0 |
0 |
||
Exceptionals |
0 |
0 |
0 |
0 |
0 |
||
Operating Profit |
30,646 |
102,902 |
136,500 |
143,000 |
150,000 |
||
Net Interest |
(417) |
804 |
3,500 |
3,500 |
3,800 |
||
Profit Before Tax (norm) |
|
|
30,229 |
103,706 |
140,000 |
146,500 |
153,800 |
Profit Before Tax (IFRS) |
|
|
30,229 |
103,706 |
140,000 |
146,500 |
153,800 |
Tax |
(7,643) |
(23,563) |
(35,000) |
(35,160) |
(38,450) |
||
Profit After Tax (norm) |
22,586 |
80,143 |
105,000 |
111,340 |
115,350 |
||
Profit After Tax (IFRS) |
22,586 |
80,143 |
105,000 |
111,340 |
115,350 |
||
Discontinued businesses |
0 |
0 |
0 |
0 |
0 |
||
Net income (norm) |
|
|
22,586 |
80,143 |
105,000 |
111,340 |
115,350 |
Net income (IFRS) |
|
|
22,586 |
80,143 |
105,000 |
111,340 |
115,350 |
Average Number of Shares Outstanding (m) |
28.1 |
28.1 |
28.1 |
28.2 |
28.2 |
||
EPS - normalised fully diluted (c) |
|
|
80.3 |
285.0 |
372.6 |
394.4 |
407.8 |
EPS - (IFRS) (c) |
|
|
80.5 |
285.6 |
373.4 |
395.2 |
408.7 |
Dividend per share (c) |
45.0 |
160.0 |
185.0 |
210.0 |
225.0 |
||
Special dividend per share (c) |
0.0 |
200.0 |
0.0 |
0.0 |
(0.0) |
||
Gross Margin (%) |
28.7 |
28.2 |
30.4 |
30.3 |
30.2 |
||
EBITDA Margin (%) |
4.5 |
9.5 |
10.7 |
10.6 |
10.6 |
||
Operating Margin (before GW and except.) (%) |
3.9 |
9.0 |
10.3 |
10.0 |
10.0 |
||
BALANCE SHEET |
|||||||
Fixed Assets |
|
|
40,011 |
47,940 |
47,709 |
66,056 |
66,556 |
Intangible Assets |
0 |
1,010 |
1,010 |
1,010 |
1,010 |
||
Other intangible assets |
1,045 |
957 |
957 |
957 |
957 |
||
Tangible Assets |
24,667 |
29,255 |
31,255 |
49,655 |
50,155 |
||
Right of use assets |
11,725 |
13,103 |
11,400 |
11,400 |
11,400 |
||
Deferred tax assets |
600 |
2,381 |
3,034 |
3,034 |
3,034 |
||
Retirement benefit asset |
|
|
1,974 |
1,234 |
53 |
0 |
0 |
Current Assets |
|
|
127,771 |
192,353 |
222,434 |
253,789 |
311,276 |
Stocks |
20,559 |
18,090 |
20,467 |
22,446 |
23,074 |
||
Debtors |
63,589 |
87,511 |
96,967 |
106,343 |
108,202 |
||
Cash and short-term deposits |
41,589 |
86,752 |
105,000 |
125,000 |
180,000 |
||
Other |
2,034 |
0 |
0 |
0 |
0 |
||
Current Liabilities |
|
|
(73,027) |
(87,401) |
(107,658) |
(113,134) |
(116,036) |
Creditors |
(71,877) |
(85,966) |
(106,278) |
(111,984) |
(115,116) |
||
Short term borrowings |
0 |
0 |
0 |
0 |
0 |
||
Lease liabilities |
(1,150) |
(1,435) |
(1,380) |
(1,150) |
(920) |
||
Long Term Liabilities |
|
|
(11,789) |
(12,672) |
(11,278) |
(10,078) |
(10,078) |
Long term borrowings |
0 |
0 |
0 |
0 |
0 |
||
Lease liabilities |
(10,939) |
(12,315) |
(10,920) |
(9,720) |
(9,720) |
||
Other long term liabilities |
(850) |
(357) |
(358) |
(358) |
(358) |
||
Net Assets |
|
|
82,966 |
140,220 |
151,207 |
196,633 |
251,718 |
CASH FLOW |
|||||||
Operating Cash Flow |
|
|
22,846 |
101,317 |
168,500 |
132,875 |
159,350 |
Net Interest |
(409) |
699 |
3,500 |
3,500 |
3,800 |
||
Tax |
(6,414) |
(20,755) |
(32,500) |
(32,660) |
(35,950) |
||
Capex |
(3,465) |
(8,011) |
(8,300) |
(27,000) |
(10,000) |
||
Acquisitions/disposals |
0 |
(1,700) |
0 |
0 |
0 |
||
Pension contributions |
(4,589) |
(4,367) |
(6,600) |
0 |
0 |
||
Financing |
(843) |
(866) |
(900) |
(900) |
(900) |
||
Dividends |
(4,134) |
(18,722) |
(103,560) |
(54,612) |
(60,744) |
||
Other/ Capital portion of lease repayments |
(1,117) |
(2,432) |
(1,900) |
(1,200) |
(500) |
||
Net Cash Flow |
1,875 |
45,163 |
18,240 |
20,003 |
55,056 |
||
Opening net debt/(cash) |
|
|
(39,766) |
(41,589) |
(86,752) |
(105,000) |
(125,000) |
Net impact of disposals etc |
0 |
0 |
0 |
0 |
0 |
||
Other |
(53) |
0 |
8 |
(4) |
(56) |
||
Closing net debt/(cash) |
|
|
(41,589) |
(86,752) |
(105,000) |
(125,000) |
(180,000) |
Source: 4imprint Group accounts, Edison Investment Research
|
|
Research: TMT
Centaur’s year-end trading update indicates that the group has delivered a strong EBITDA margin for FY23, above 25% and well ahead of the level targeted in the MAP23 margin acceleration plan. This is despite it having been a difficult year in which to grow revenues, with clients slow to close out larger contracts, as broadly reported across the sector. We currently expect confidence to pick up in H224, after a relatively cautious start to the year. We have made provisional adjustments to our estimates on that basis, with the picture likely to be clearer by the March prelims.